COLIN BAKER LONDON
Italian regional National Jets Italia (NJI) is to be the first acquisition for Aviation Partners Worldwide, a UK-based airline investment shell company.
Aviation Partners, previously known as Tolmount, is paying an initial £30.7 million ($44 million) in new Tolmount shares, with an extra £4.2 million payable, depending on performance, for NJI. Aviation Partners aims to raise £13-16.5 million through a share placement to fund NJI's working capital and repay some debts. It is buying NJI- which operates Boeing 737s and BAESystems 146-300s - from majority owner Dutch investment company Magitbay Holdings and BAE Systems.
Aviation Partners has attracted Peter Sutch, the former head of Cathay Pacific, to act as it chairman. During his time in Hong Kong - before returning to the UKin 1999 - Sutch had appointed Rod Eddington, now British Airways chief executive, as his chief operating officer.
Rome-based NJIis a BA franchise set up by Warren Seymour, who established Qantas franchise partner National Jet Systems in Australia before selling it for £24.5 million in 1999. The management includes Michael Scantlebury, a former financial manager at Cathay. "I wouldn't call it an old boys network, but the people involved definitely knew each other," says one source close to the talks.
NJIwas set up to take advantage of a perceived gap in the market at Rome Fiumicino Airport following Alitalia's transfer of its main hub to Milan Malpensa. NJI estimates that it has built a 22.5% market share on Rome-Sicily routes. The carrier also operates on the Rome-Milan Linate market, where it intends to increase services from two to eight times a day in September, and 12 later this year. It also plans to add Tel Aviv, Istanbul and Cairo to its Athens and Nice international destinations.
Once NJI has been bedded in, Aviation Partners will seek new targets, probably in the developed world.
Source: Airline Business
